Investor and plan sponsor priorities changing: survey
Retirement advisors might want to consider updating their value proposition to include holistic financial advice, John Hancock survey suggests.
Meeting investor needs begins with first understanding what is important to them. Research by John Hancock found increasing demand for holistic solutions.
“We’ve seen growing interest among plan sponsors and financial professionals in holistic financial advice delivered at the workplace,” according to its annual survey of financial stress among retirement plan participants. “That interest may have reached an inflection point.”
Improving overall financial wellness of employees was the top priority among 401(k) plan sponsors, identified by one-quarter of respondents. This places it above such expected choices as reducing plan costs, improving the investment lineup and even maximizing retirement savings.
Increased life expectancy also is influencing investor needs.
“While elder years can certainly be fulfilling and enjoyable, they also present a cascade of challenges that may not be clearly in focus when retirement income goals are first set,” the report said. “Some may continue working out of need or preference; often, there are one or more changes in living arrangements, and both life care and health care are ever-present concerns. In other words, life in retirement doesn’t always go as planned.”
These challenges can involve logistics, safety and emotions as well as money.
“Your staff and referral network may already offer assistance with traditional retirement income, investment, income-tax and estate planning,” according to the report. ”But what if you were also more closely tuned to the lifestyle dynamics that often drive seniors’ financial realities — the need for transportation, caregiving, appropriate housing, navigating government benefit programs, and ongoing employment?
“You’d be even better equipped to help your clients and their family members connect the financial dots and help make their money last. And that could be a legacy-changing transition for your firm, as well as for your customers.”
Understanding and acting on these trends can be beneficial to financial advisors well as their clients.
“Lean into the changes under way and throw some ideas around with your trusted partners and clients,” the report concluded. “Your advice can be more valuable than ever with an updated value proposition, solid partnerships and a little creative packaging.”